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S H

K U

Summer Training Research Report on


M
Marketing Strategy of By-products &

A R

Secondary Product at,

Bokaro Steel Plant under,SAIL


r SUBMITTED TO: a j a k

Gautam Buddh Technical University, Lucknow For the partial fulfillment of the requirement of Master of Business Administration (MBA-2010-12)

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Under the guidance of: Mr. Prabhat Dwevedi SUBMITTED BY DIGVIJAY NATH MBA FINAL YEAR

Under the/supervision of: Mrs. Meena kamal M

B A / 5 1

ROLL NO.-1018170027

SCIENCE AND TECHNOLOGY ENTREPRENEURS PARKi HARCOURT BUTLER TECHNOLOGICAL INSTITUTE, NAWABGANJ

t ,

KANPUR-208002

D u r

PREFACE The word Marketing is not new to us but there have occurred a sea changes in its principles since the time it was first heard . When we talk about marketing strategy of a firm, one need to constantly waste a lot of chalks on his drawing board to outdo their competitors. So it is a place of constant innovation & one need to have an eagle eye on their competitors. I student of School Of Management, STEP-HBTI,Kanpur pursuing MBA (Mktg) course and towards the partial fulfillment of it , I have undergone a summer project named Study on marketing strategy of secondary & by-product in Bokaro Steel Plant for a period of EIGHT(8) weeks .I used my expertise to complete the objective accomplished in the stipulated time as study of marketing strategy is not a cup of tea. Despite all the limitations, obstacles, hurdles and hindrances, I came across many difficulties to make this objective a reality. Anyhow with the kind help and genuine interest formally supported by my guide and college authorities. The purpose of this project is to understand the strategy adopted by BSL to sell their secondary & by-products. In later part of this project we will able to understand how BSL has been effectively utilizing the scraps (i.e.
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secondary products) produced during the different production process & also how constant improvement in different sections is helping BSL to provide quality products for customers with time on delivery. Though every effort have been made to present accurate data & correct information, although if you find any part of the project unacceptable, I will be highly obliged to hear your suggestions.

ACKNOWLEDGEMENT Any task is not a single person effort, same is with this project. Thus I would like to extend my sincere thanks to all those people who helped me in accomplishing my project . The informations & ideas contained in this project is the manifestation of learning process during my Eight weeks of training period. During my training period I came across some wonderful peoples in the form of managers, my mentor, friends or acquaintances from whom I learned immensely. While it is not possible to name them individually I would like to express a deep sense of gratitude towards them. I would also like to express my heartfelt thanks to all the officers of Bokaro Steel Plant who really helped a lot and guided me throughout my training session, This project would not have been possible in the absence of their help.
I like to thanks Mr. B.K Prasad (DGM,Stores), Mr. Haldhar Ojha (AGM,SSD), Mr. Prasad (AGM,BPP), Ms. Manisha (Jr.manager, S&C) and Mr. Ashok Rai(e-Auction,metal junction) who are directly involved in this project.

No amount of thanks can be ever repay the great debt that I own of Mr. Gobinda burman (Jr.Manager ,Marketing), whose constant guidance & inspiration have made this project successful.
Submitted with regards,

Digvijay Nath
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TABLE OF CONTENTS

CHAPTER 1.

SUBJECT 1.1 1.2 1.3 EXECUTIVE SUMMARY OBJECTIVE OF STUDY METHODOLOGY

PAGE NO. 1 10 11 12-30

2.

BRIEF PROFILE OF THE UNIT UNDER STUDY SAIL,BOKARO STEEL PLANT 2.1 2.2 2.3 2.4 2.5 2.7 INTRODUCTION OF SAIL ABOUT METAL JUCTION CENTRAL MARKETING ORG. ABOUT BSL CORE VALUE OF BSL MAJOR UNITS OF BSL

12-14 15-`16 17-20 21-25 26 27-30 31-39 31-36 37-39

3.

SECONDARY AND BY-PRODUCT IN BSL 3.1 3.2 WHAT ARE SECONDARY PRODUCTS AND BY-PRODUCT NECESSITY OF SELLING THE SECONDAY PRODUCT AND BY-PRODUCT

4.

MARKETING DEPARTMENT (BSL) 4.1 4.2 4.3 OBJECTIVE FUNCTION MARKETING POLICY

41-51 41-42 43 44-48 49-55 49-55

5.

STRATEGY 5.1 MARKETING STRAEGY OF BSL

6.

MODE OF SALE 5.1 E-AUCTION, PROCEDURE OF E-AUCTION, RULE AND

56-68 57-62

REGULATION, CONDUCTION OF AUCTION AND TERMS AND CONDITION. 63-65 5.6 5.7 SALE THROUGH FIXED PRICE 66-68 OPEN TENDER

6.

DATA ANALYSIS 6.1 DATA COLLECTED FROM MARKETING AND OTHER

69-75 69-75

DEPARTMENTS OF BSL

7. 8.

SWOT ANALYSIS FINDING

76-77 93

9.

SUGGESTION & RECOMMENDATION

79-80

CONCLUSION 81 QUESTIONNAIRE100 ABBREVIATION 116 BIBLIOGRAPHY .117

EXECUTIVE SUMMARY
The present study was undertaken to see the mode of sale of Secondary Product and by- product of SAIL. Marketing Department is the newest genesis from the SAIL and attempts to reach their where no corporate has ever ventured so far. The survey was conducted in Marketing Department and Sales Coordination department. I was to find how auctions, fixed price and tenders are used for marketing purpose BSL. Various steps involved are as follows. To know about the e-auctions of Marketing Department. How they use this technique and 60% marketing and selling is done through auction and rest will be taken through fixed price selling and tenders. Data were mainly collected from Marketing department of BSL. BSL is the largest Steel manufacturing sector of India and is top ranked in the global fortune 500 companies. During my training I had to find out mode of sale of secondary products of BSL. Primary products are sold by CMO, Delhi. I passed through various stages of problems and difficulties to accomplish the task of

project work but it was a privilege for me to take this opportunity a challenging work to study and observe "marketing of Secondary products in B.S.L", which is a unit of SAIL. Bokaro Steel Plant recognizes that leadership is essential for survival in competitive environment; Customer's satisfaction like quality is a journey and not a destination. It is essential that everyone in the company have a clear understanding of what customer satisfaction means if the plant aim to achieve leadership in customer satisfaction. While improved customer satisfaction is necessary for ensuring prosperity of the company must also be recognized that ability of the company to satisfy its customers would depend on its ability to continuously improve its profit and growth.The basic objective behind the study carried out by me is to study the major contribution of Secondary product and By- product to total sales, which is predetermining for the success of the company. By selling the Secondary product in local market company is earning profits. It is also creating an employment in small scale industries and developing the economy.

OBJECTIVE OF THE STUDY


In Bokaro steel plant there is various section of marketing department. Since I have chosen "Marketing of secondary products in B.S.L." my main objectives are:-

1. To know what is secondary product, by product and why is it necessary to sell the secondary product.

2. To know the use of secondary product & by-product.

3. Market study of secondary product & by-product in BSL.

4. To know the pricing of secondary product & by-product.

5. Ensuring timely dispatch of material, products, scrap etc to the potential customers.

6. To know the others terms and conditions for marketing of secondary products.

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METHODOLOGY USED
The methodology adopted by me during the project on "Marketing of Secondary Product on B.S.L" can be divided into two parts: (A) To know about the organization. (B) To know about the procedure and working of Marketing Department and Secondary Section. (A) To know about the organization. Information / data has been Collected from:(i) Government Publications. (ii) Books of organization. (iii) Journal. (iv) Company's Website. (B) To know about the procedure and working of Marketing Department and Secondary Section information has been collected by: (a) Observation Method (b) Personal Interview with AGM , Senior managers ,Managers.

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(C) Document provided by them.

INTRODUCTION
Iron & steel are being use by men for almost 6000 years, but the modern form of iron & steel industry came into being only during 19th century. This industry has grown very rapidly only after the Second World War; World production was 2.83 MT in 1900, rose to 159.6 MT by 1943 and 782.8 MT in 1989. The total demand of steel in the world was to be 913 MT in 2007. Worlds 1st Iron works was established in 1646 in USA. In 1984 1st open Hearth Furnace was used in Europe for making steel. In 1906 1 st are Furnace was used. In 1950 1st Basic Oxygen Furnace was used. In 1960 Computer was used in steel industry. In 1970 Continuous Casting Process was used for the production of steel and 6% of total steel were produced through this process. Now 66.6% of the worlds raw steel production is through this process. As a result product yield increased from 81% to 95% and reduced its energy consumption by 12.5%. Japan is producing 95.4% of its steel production through this process, the highest in the world. Japan is the largest exporter of steel in the world with 18

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MT of finished products. Japan is the 2nd biggest producer of steel in the world with 119.3 MT. the 1st is USSR and 3rd is USA with 82.2 MT. Steel Authority of India Limited (SAIL) is the leading steel making company in India. It is a fully integrated iron and steel maker , producing both basic and special steels for domestic construction , engineering , power , railway , automotive and defense industries and for sale in export markets.

Ranked amongst the top ten public sector companies in India in terms of turnover, SAIL manufactures and sells a broad range of steel products, including hot and cold rolled sheets and coils, galvanised sheets, electrical sheets, structurals, railway products, plates, bars and rods, stainless steel and other alloy steels. SAIL produces iron and steel at five integrated plants and three special steel plants, located principally in the eastern and central regions of India and situated close to domestic sources of raw materials, including the Company's iron ore, limestone and dolomite mines. The company has the distinction of being Indias largest producer of iron ore and of having the countrys second largest mines network. This gives SAIL a competitive edge in terms of captive

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availability of iron ore, limestone, and dolomite which are inputs for steel making. SAIL's wide ranges of long and flat steel products are much in demand in the domestic as well as the international market. This vital responsibility is carried out by SAIL's own Central Marketing Organisation (CMO) and the International Trade Division. CMO encompasses a wide network of 37 branch offices and 25 departmental Warehouses located in major cities and towns and throughout India With technical and managerial expertise and know-how in steel making gained over four decades, SAIL's Consultancy Division (SAILCON) at New Delhi offers services and consultancy to clients world-wide. SAIL has a well-equipped Research and Development Centre for Iron and Steel (RDCIS) at Ranchi which helps to produce quality steel and develop new technologies for the steel industry. Besides, SAIL has its own in-house Centre for Engineering and Technology (CET), Management Training Institute (MTI) and Safety Organisation at Ranchi. Our captive mines are under the control of the Raw Materials Division in Kolkata. The Environment Management Division and Growth

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Division of SAIL operate from their headquarters in Kolkata. Almost all our plants and major units are ISO Certified.

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ABOUT METAL JUNCTION


Corporations across the world have realized that in a world without boundaries, certain regions and people with distinct competencies will be more efficient than others and therefore the visible trend in the world today is outsourcing. Companies are outsourcing manufacturing activities, customer services, back office operations and a host of other activities, either because there is someone else who can do the same thing for less, or, there is specialist who can offer services of higher quality. Industry has recognized that whilst it has to concentrate on growth, a prerequisite is to become globally competitive. Industry has to, on the one hand, concentrate on its core competencies of bringing about efficiencies in manufacturing and on the other hand look at bringing about efficiencies in their Supply Chain which is their buying and selling processes. Metaljunction operates at the extreme ends of the value chain and hence it was essential to segregate the organization into two Major Business Units (Commercejunction and Metaljunction) so as to independently focus on: Specific Requirements of Clients/Customers Specific procedures for both the functions
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Knowledge and Information management for the two functions

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It is a joint venture between Tata Steel and SAIL


CENTRAL MARKETING ORGANISATION
The ISO 9001:2000 certified Central Marketing Organization (CMO) is Indias largest industrial marketing set up that markets carbon steel produced by the four integrated steel plants of SAIL. Headquartered in Kolkata, it transacts business through its network of 34 branch sales offices spread across the four regions, 24 Warehouses equipped with mechanized handling systems, 11 Customer Contact Offices and 15 Consignment Agents. CMOs domestic marketing effort is supplemented by its ever widening network of authorized and rural dealers who meets the demands of the smallest customers in the remotest corners of the country. A strong IT support system enables real time network connectivity within the entire CMO network. Extensive customer contact, product and segment specialization, close monitoring of order servicing and feedback analysis through the Customer satisfaction Index are established norms at CMO. The customer friendly approach of CMO is backed by practical after sales service.

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Through the process of Key Account Management, CMO provides single window service to key customers across the country for every business transaction from enquiry to order booking, order tracking to delivery, and even consultancy after-sales service. Central Marketing Organization (CMO) is India's largest marketing home. It has spread its wings far and wide from Srinagar in the North to Cochin in the South and Dhimapur in East to Ahmedabad in the west. All SAIL Product are marketed in India through C.M.O. to ensure quality and prompt dispatch of product, CMO keeps in touch with producing units as well as the transport and shipping sectors. It operates through the network of stockyards, dockyards, Branch sales offices, consignment agents and Extension counter. CMO has got responsibility to sell pig iron and mild steel products manufacture by BSL, DSP, RSP, and BSP, having its headquarters at Ispat Bhavan, 40 Chouringee Road, Kolkata 71. CMO Branches spread through out the country with stockyards for storing and selling Iron & Steel materials of the plants. CMOs International Trade Division International Trade Division ( ITD), in New Delhi- an ISO 9001:2000
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accredited unit of CMO, undertakes exports of Mild Steel products and Pig Iron from SAILs five integrated steel plants. Ever ready to meet the exacting demands of its global customers, ITD maintains a close liaison with customers and the production units to cater to the customized requirements of its customers both in terms of quality and sizes.

ITD has successfully established SAILs brand name globally. Among the notable destinations for SAIL products are Japan, P.R. of China, Korea, Taiwan, Vietnam, Philippines, Singapore, Malaysia, Thailand, Indonesia, Australia, Mexico, Europe (UK, Germany, France, Belgium, Italy, Spain, Netherlands, Portugal), Sudan, Oman, UAE and the neighbouring countries such as Myanmar, Bangladesh, Sri Lanka and Nepal.

The Transport & Shipping Division of CMO headquartered at Kolkata with its branch offices at Haldia, Paradip, Vizag and Kolkata ports, ensures timely import of the key ingredient in steel making, coking coal and handles its entire logistics. It also caters to other plant imports and ensures efficient dispatch of steel exports.

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Ispat Bhavan Headquarters 40, Jawaharlal Nehru Road, Kolkata - 700 071. Phone: (033) 2288 3810/12/14/17/18 Fax: (033) 2288 61838

International Trade Division

Hindustan Times House 13th Floor, 18-20, Kasturba Gandhi Marg, New Delhi - 110 001. Phone: (0091-11) 2335 5733. Fax: 0091-11-

E-mail: sailcaib@cal.vsnl.net.in

2332 1018,2371 2774 E-mail: editd@sailsteel.com

Regional Offices
Western Region

The Metropolitan 8th & 9th floor, Bandra-Kurla Complex, Bandra (E), Mumbai- 400 051.

Southern Region

Ispat Bhavan 5 , Kodambakkam High Road, Chennai - 600 034. Phone:044-2827

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Phone: (022) 2657 1493/96/97.


Phone FP 022Fax 022rmfpwr@sailGroup 26572788/ 2657 steel.com 26571836 LP 0221996 E-Mail

2091/2827 4105.
Phone FP 044Fax 044-2827 rmfpsr@sailGroup 28257164/ 1602/ steel.com 28274105 28242342 LP 044044-2827 rmlpsr@sail1602 steel.com E-Mail

Group 28259660 022rmlpwr@sailGroup 26571819/ 2657 steel.com 26571827 2042

Transport and Shipping

Headquarters

Ispat Bhavan 40, Jawaharlal Nehru Road, Kolkata - 700 071. Phone: (033) 2288 3810/6151 Fax: (033) 2288 61808

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BOKARO STEEL PLANT A PARTNER IN NATION BUILDING

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INTRODUCTION
Bokaro Steel Plant - the fourth integrated plant in the Public Sector started taking shape in 1965 in collaboration with the Soviet Union. It was originally incorporated as a limited company on 29th January 1964, and was later merged with SAIL, first as a subsidiary and then as a unit, through the Public Sector Iron & Steel Companies (Restructuring & Miscellaneous Provisions) Act 1978. The construction work started on 6thApril 1968. The Plant is hailed as the countrys first Swadeshi steel plant, built with maximum indigenous content in terms of equipment, material and know-how. Its first Blast Furnace started on 2nd October 1972 and the first phase of 1.7 MT ingot steel was completed on 26th February 1978 with the commissioning of the third Blast Furnace. All units of 4 MT stage have already been commissioned and the 90s' modernization has further upgraded this to 4.5 MT of liquid steel. The new features added in modernization of SMS-II include two twinstrand slab casters along with a Steel Refining Unit. The Steel Refining Unit was inaugurated on 19th September, 1997 and the Continuous Casting Machine on 25th April, 1998. The modernization of the Hot Strip
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Mill saw addition of new features like high pressure de-scalers, work roll bending, hydraulic automatic gauge control, quick work roll change, laminar cooling etc. New walking beam reheating furnaces are replacing the less efficient pusher type furnaces. A new hydraulic coiler has been added and two of the existing ones revamped. With the completion of Hot Strip Mill modernization, Bokaro is producing top quality hot rolled products that are well accepted in the global market.

Bokaro is designed to produce flat products like Hot Rolled Coils, Hot Rolled Plates, Hot Rolled Sheets, Cold Rolled Coils, Cold Rolled Sheets, Tin Mill Black Plates (TMBP) and Galvanized Plain and Corrugated (GP/GC) Sheets. Bokaro has provided a strong raw material base for a variety of modern engineering industries including automobile, pipe and tube, LPG cylinder, barrel and drum producing industries. Directions Bokaro Steel is working towards becoming a one-stop-shop for worldclass flat steel in India. The modernization plans are aimed at increasing the liquid steel production capacity, coupled with fresh rolling and coating facilities. The new facilities will be capable of producing the

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most premium grades required by the most discerning customer segments. Brand Bokaro will signify assured quality and delivery, offering value for money to the customers.

BRIEF GEOGRAPHICAL INFORMATION OF BOKARO STEEL CITY

LOCATION

Along the south bank of Damodar river on Dhanbad-Ranchi highway at a distance of 50 km from Dhanbad and 300 km from Kolkata.

LATITUDE LONGITUDE

23 29 86 9

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ALTITUDE RAINFALL TEMPERATURE CLIMATE WIND DIRECTION SOIL

210 (meter) varying from 195m to 224m. Average 157cm Maximum : 195cm Max : 47c Min : 12c Hot & dry, i.e. Tropical South-West to North-East

Loamy up to 1 to 2 meters and then sandy

COLOUR OF SOIL Red, yellow and light grey HILLOCK FOREST GRASSLAND TOTAL LAND AREA PLANT (BSL) GARGA RESERVOIR 17,208.01 Acres 3,886.87 Acres (Storage Capacity =17.5 million m) Sarsl pahar (296m high, 5.5 km south of Bokaro) Bandgora (sal forest) About 3-5% of total land 33,045.53 Acres

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RAILWAYS GREEN BELT POPULATION SOURCES

1,835.94 Acres 1,011.74 Hectares About 3.5 lakhs Water - Garga river & Tenu Canal Power-Chandrapura TPP(DVC),Bokaro TPP & CPP

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CORE VALUES OF BSL

Core Values

Customer Satisfaction

Concern for People

Consistent Profitability

Commitment of Excellence

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BOKARO STEEL PLANTMAJOR UNIT


Brief Description: COKE OVEN AND BY PRODUCT PLANTS: Only shop in the country to have silos for source wise storage. The carbonization temperature is 10000C. Coke oven has 8 batteries with 69 ovens each. By-products plant produces valuable by-products like, anthracene oil, benzene, toluene, xylene, light solvent naptha and ammonium sulphate, extra hard pitch. Coke Sources: Prime coking coal: Dugda, Moonidih, Belatand Medium coking coal: Mahuda, Rajrapa, Kedla, Kathar Middlings for Power Plant: Dugda, Swang, Mahuda, Kedla, ECL RAW MATERIAL AND MATERIAL HANDLING PLANTS: Responsible for receipt, blending, storage, screening and supply of raw material to blast furnace, sinter plant and lime dolomite shop. Shop also maintains buffer stock to take care of any interruption in supply from mines.
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Around 9MT of different raw materials are handled by four wagon tipplers, stackers and re-claimers. Only plant in India to have source-wise blending facilities at RMCH. Raw Material Sources: Iron Ore: Kiriburu, Meghataburu, Gua, Noamundi. Limestone: Bhawanathapur, Puranapani, Kahanabanjari, Kuteswar, Jaisalmer. Dolomite Limestone: Nanwara, Ametha. Manganese Ore: Barbil, Banspani Bauxite: Lohardaga. BLAST FURNACE: Five 2000 cubic meter blast furnace. Furnaces are equipped with beltless top charging, double cast houses, coal dust tar injection, cost house slag granulation, underburden probes. STEEL MELTING SHOPS: SMS-I: 5 LD converter of 120T capacity each.
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SMS-II: 2 LD converters each of 300T capacity (Largest in India). SMS-I produces Rimming Steel also. CONTINUOUS CASTING SHOP: Integrated to SMS-II. Produces mild steel of drawing, deep drawing, extra deep drawing, boiler and tin plate quality. Also produces low alloy steels like LPG, WTRC, SAILCOR and API Grade. SLABBING MILL: COUNTRYS ONLY Universal Mill, Hot and Cold Scraping Machine. 2800T Shearing Machine. Controlled heating in Soaking Pits. HOT STRIP MILL (HSM): Only continuous Hot Strip Mill in India, fully automatic. Walking beam Reheating Furnaces, High pressure De-scaling system, Roughing Group: Roughing Train of Vertical scale beaker,

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one 2-high roughing stand, for high universal roughing stand and edge. Finishing Group: Flying Shear, Finishing Scale Beaker, Seven 4high finishing stands.

HOT ROLLED COIL FINISHING: Hot rolled coil from HMS received here for further distribution. Coiled sheared and finished to customer required size and dispatch to customer. COLD ROLLING MILL: Produces high quality sheet gauge materials, tin mill black plate and galvanised products. Capable of rolling out the widest sheet in India. Products used for deep drawing purpose, automobile bodies, furniture, drums, barrels, railway coaches, other blending and shaping jobs and coating.

QUALITY ASSURANCE:
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Entire Production flow, including allied departments, accredited under ISO 9001:2000. Quality Management System ISO 14001:2004. Environment Management System implemented in all production and allied shops SHOAS 18001:1999 Standards for occupational health and safety implemented in all production and all allied shop. SCRAP AND SALVAGE DEPARTMENT: As the name signifies, the department works with Ferrous [Iron & steel] scrap to salvage it & make it useful by adding value to it. SSD has a dual role to play in overall scheme of things in the works division. Primarily it has to supply Iron and Steel scrap to Steel Melting Shop (SMS) as a technological input in the Steel Melting process. Secondly, the role of SSD is to collect all the Ferrous Scrap (waste for the place of origin) and bring it to the department to transform it into a useful product. Every department of the plant from Coke Oven to Cold Rolling Mill produce mental waste termed scrap. This may be in the form of maintenance waste e.g. broken or worn out parts, damaged structure or equipment or may be process arising. The prime products continue on their production flow towards the final defined output, while the arising have

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to drop out as they are not suitable chemically, Mechanically or by size and shape. In the shape of fish tails or irregular edge trimming or produce which are below the planned size. In a nut shell SSDs role is to ensure that all Iron and Steel Scrap (unwanted at place production) are transported to site processed and transformed to usable shape, size and quality (free of slag etc.) and transported SMS Magnetic Scrap Yards for using as coolant in the converter bath. Surplus scrap after supplying the requirement of scrap is offered for external sale to generate cash resources for the Company.

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SECONDARY PRODUCT AND BY-PRODUCT


Secondary Products: These are the defectives or rejected materials due to improper mixing of chemical components or fail to meet the optimum requirements. Scraps generated inside plant are also termed as Secondary products. The secondary products used here in after will mean ferrous materials generated from various production units which can either suitably be used for re-melting to produce iron and products or offered for sale if rendered surplus in production process for example Defective Heavy blooms, Defective Rails, Rail cutting, Rod cutting, Scrap etc. Following Items fall under the category of Secondary Products:(A) REROLLABLE/IRON AND STEEL SCRAP/BFG SLAG 1. MS SLAB END CUTTING WITHOUT FISH TAIL 2. HR Coil 3. CR Coil 4. AMG HR Plate 5. Cobbled Plate
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6. MS THICLE PLATE CUTTING (25-40 MM) MIXED W.FR. 7. SPILLED HOT METAL (10 MT AND BELOW) SMS ARISINGS. 8. LIQUID NITROGEN. 9. FINE IRON CHIPS FROM IMP (FE-70% APP 10.LIQUID ARGON. 11.PIG TRON. 12.TURNING & BORING. (B) OTHERS 1. CARBIDE SLUDGE. 2. U/R AMC/MCB BRICKS. 3. U/R MAJ CHROME MAJ BRICKS. (C) COAL CHEMICALS AND BY PRODUCT 1. MG BENZENE 2. NG TOLUENE 3. LS NAPTHA 4. SB OIL 5. HP NAPHTHALENE 6. ANTHRANCENE OIL 7. EXTRA HARD PITCH 8. HARD MEDIUM PITCH SOLID STATE
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9. HARD MEDIUM PITCH LIQUID STATE A. Benzyl products (Benzene) Place of production- Bokaro steel plant. Mode of delivery - railway tank wagons , road tankers in loose condition. Uses- it is used as an important raw material for various drugs and dyes. Benzene hexa chloride is used as a pesticide. It is also used in the manufacturing of phenol, DDT, nylon-6 etc.

B. Toluene (Nitration grade) Place of production- Bokaro steel plant . Mode of delivery- railway tank wagons. Uses- It is used as a solvent in many chemical reactions; artificial Sweetening; paint manufacturing; rubber industries; adhesives Making of printing ink C. Xylene Place of production- Bokaro steel plant .
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Mode of delivery- railway tank wagons . Uses- Paints, thinners & varnish, rubber industry and printing ink. D. Light solvent naptha Place of production- Bokaro steel plant . Mode of delivery- railway tank wagons. Uses- as a solvent, starting material for dyes and printing ink. E. Still bottom oil Place of production- Bokaro steel plant . Mode of delivery- railway tank wagons/road tankers. Uses- mixed with other materials and is used various purposes like roof tar filling to make the roof of buildings water-leak proof, rubber paint for vehicles, industrial oil etc. F. Extra hard pitch Place of production- Bokaro steel plant . Mode of delivery- in gunny bags in loose condition. Uses- in aluminum industries as a binding material for anode. G. Soft pitch
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Place of production- Bokaro steel plant . Mode of delivery- in gunny bags in loose condition. Uses- it is used in production of pitch fiber pipes, roof binders, in preparation of road tar, building materials, sheeting, tilling etc. it is also used as refractory brick.

H. Hot pressed naphthalene Place of production- Bokaro steel plant . Mode of delivery- in gunny bags in loose condition. Uses- Dye intermediate, as an insecticide, dispersing agent. DETAILS OF SCRAP There are various types of scrap, which is generated from the particular prime products. Some brief summaries are given here: 1. PCM SCRAP

This is a scrap generated in the pig-casting machine and consists of Splashing, PCM runners and fires are in the fix range of up to 1.0 tones per piece.

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2.

BF RUNNER SCRAP

Generated in the blast furnace cast houses in the form of runner jams etc the maximum fix per piece is up to 2 tones. This scrap contain amount of slag. 3. UNPROCESSED STEEL

Generated in the steel melting shops in slag cups and metal ladles. 4. SBIM SCRAP

This consists of semi broken ingot mould and bottom part as scrap and is in fix range up to 2 tones per piece. 5. COBBLED SCRAP

The cobbled scrap arises from wire rod mill and includes some rejected coils and binding wires also. 6. REJECTED ROLLS.

Cast iron rolls rejected steels rolls. 7. MILL CUTTINGNS

Rail and structural mill cuttings, merchant mill cuttings, rail cuttings,

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plate end sharing rejected slabs, Slabs cuttings, miss rolled slabs, and wire rod cuttings are included in this type of scrap. COLLECTION OF SCRAP 1. All scraps identify the metallic scrap generated in the production, process and lying in the shop. The shops collected the scrap with the help of overhead cranes and stock them for loading into wagons. 2. Rejected rails and sleepers lying near the railways track inside the plant are collected at such points from where loading and collection by truck is possible. 3. Crane facility is provided for loading the scrap into the truck whenever cutting or processing not possible on the spot. 4. Scrap & Salvage department is responsible for over all coordination of scrap collection from the entire plant. For this each shop nominate one executive for ensuring the clearance of scrap from the shop. 5. Head of Marketing and customer service department requires the progress on scrap collection on weekly basis.

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NECESSITY OF SELLING THE ''SECONDARY PRODUCTS and ByProduct" The net sales realization from all the Secondary products, By-Products and co-products of BSL is around Rs.600 crores which is quite more than money the big industries. Out of this Steel Scarp arising itself brings about Rs.15200 cores of money every year. Re-production of main products from the; secondary products requires re-melting it again for the required composition of the materials as per the desired specification. By selling it to the different Mills/traders/Processors the plant earn around Rs.4000 per tones of the direct profit than by re-producing it to the main product. The traders /processors/re-rollers, use these as a raw materials for different finished products making huge profits, the plant is also not losing anything. Profit is the main aim of every business, and when the realization of these products for the finished products proves to be costlier, the management plant decided to sell it to the local market. By selling secondary Products to the Local market new industries are developed for re-rolling the Secondary materials to make finished

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products. It has also increased the small-scale industries and employment opportunities. Last year average price of scrap product were between Rs.12000/ton to Rs.16000/ton.

Major customers

1. Ma Durga Ispat Udyog, Bokaro. 2. Bokaro Devlopement Area. 3. Kartike Ispat Pvt. Ltd, Kanpur. 4. Amit Steel Corporation, Howrah. 5. Diwan Steel, New Delhi. 6. Nenu Mal & sons, Kanpur. 7. Bhawani Metals, Bokaro. 8. Pandey Metals, Bokaro. 9. Chinar Steel Segment, Bokaro. 10.Mangal Pvt. Ltd., Bokaro. 11.United Iro Coporation, Dhanbad 12.Bharat Supply Company, Kolkatta 13.Anup Steels, Delhi
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14.Hanuman & rise Pvt. Ltd, BIADA 15.Amit Metcum Pvt. Ltd. Etc 16.Veer kanwar singh steel Pvt. Ltd. 17.Maa tara steel 18.S M S Enterprises 19.Basuki steel Pvt. Ltd 20.Shalimar steel Udoyog 21.Chotanagpur ispat Pvt. Lmt

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Latest Price of different By-Product which BSL were sold in April & May 10 with previous year price Item Naphthalene Anthracene oil Crude Benzol Toluene LS Naphtha S Boil 2008-2009 Rs.47864 Rs.13805 Rs.38354 Rs.39603 Rs.32392 Rs.20533 2009-2010 Rs.42793 Rs.18511 Rs.30961 Rs.39080 Rs.31029 Rs.19588 2010-2011 Rs.42900 Rs.13200 Rs.33450 Rs.35300 Rs.31050 Rs.18000

Latest Price of different Secondary Product which BSL were sold in April & May 10 with previous year price per MT Item HR COIL CR COIL AMG HR PLATE COBBLED PLATE 28050 30400 28500 2008-2009 27000 31850 25850 2009-2010 29250 30800 25300 2010-2011 32450 33900 29850

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ROLE OF MARKETING DEPARTMENT

48

OBJECTIVE OF MARKETING DEPARTMENT OF BOKARO STEEL PLANT


Marketing Department is one of the Departments under Materials Management Division of Bokaro Steel Plant. Marketing Department is entrusted with the responsibilities to sell BSLs Secondary Products, ByProducts/Waste Products, and Idle Assets etc. The Marketing Departments sales procedures are covered by the guidelines given by SAIL Corporate office DELHI, and is given by CMMG (CORPORATE MATERIAL MANAGEMENT GROUP), the objective of which is To sell the materials in a fair and transparent manner to achieve maximum possible revenue to the company (a) Marketing of prime products of SAILs plant including BSL is done by CMO (Central Marketing Organisation) which is a unit of SAIL.

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(b) Marketing of secondary products and coal chemicals are done directly by Marketing Department of BSL. As a matter of fact, the Secondary & By-Products are marketed by the individual Plants only. Marketing of these products are conducted by various sections by marketing department of Bokaro Steel plants. BSL is engaged, with marketing of Primary Products for home sale or export through CMO. The 4.0 Million tones section known as plate mill section dealing with plates. Now this section has got ISO - 9002 certificate.

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ORGANISTATION CHART OF MARKETING DEPARTMENT (BSL)

DGM (Mktg.) Audit, Vigilance, RTI, & other queries reply, Contract Cell(MM), Sec. Sales

AGM(Mktg.) Sec. Steel Ad & Est, QC, ISO, DCA, Contract Cell(MM)

Sr. Mgr.(Mktg.) Slag, Waste, Iron, Smug. Scheme

Sr. Mgr. (Mktg.) Idle Assets, U&S, Surplus

Sr. Mgr. (Mktg.) Coal& Chem., Zinc Dross, Ammonium Sulphate & Ferrous Sulphate

Manager (Mktg.) Reports, Price Monitoring, MIS

Jr. Mgr. (Mktg.) Secondary Steel, Safety Officer Jr. Mgr. (Mktg.)

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FUNCTION OF MARKETING DEPARTMENT

1. To monitor the orders issued by CMO, So that these orders can fulfilled. 2. Put pressure on CMO, to get orders for an underutilized mill. 3. To sell all the secondary products directly i.e. directly by BSL and by CMO. 4. On day to day basis it takes care of the dispatches i.e. daily dispatch are checked.

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POLICIES OF MARKETING
Marketing Planning has responsible function in the working of marketing department. All the risky developments, taking out solution to cripple `situations, this section carries out product pricing and related activities, some of the programmes, policies and procedures are as follows:I) Positioning the product a value based place in customer mind. II) Finalize annual sales plan and quantity, monthly, weekly, and daily rolling programme of Rolling mills in consultation with CMO and mills. This plan is based on the sales forecast receive from JPU SPL/ Iron and steel controller. III) Optimizing the product-mix by proper utilization of available stocks. IV) Receiving Enquiries and complaints, cancellation of orders etc. V) Coordinating the works of mills and traffic department so as to maximize dispatches. VI) Co-ordinations with CMO from stages of enquiry, for exports, development of new Profiles, sections, modification of product scheduling till the orders are completed.

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VII) Development of new qualities of steel. VIII) Periodical market surveys of products to analyze the market position. IX) Implementation of suggestions received from the customers feedback. X) Ensure customer satisfaction by meeting customers regularly; provide redress to their problems and fulfillment of demand.

Pricing policy and Sales Procedure:


PRICING: Fixing the price of a product is the most vital function in the whole process of the marketing and it should be done after proper market study and requires decision making ability. If price is too low the company will lose revenue and if the price is too high it will lose customers resulting in loss of revenue valuable customers. Coal chemicals are the main product which is to be marketed by the Marketing Department of Bokaro Steel Plant. Almost all the products are sold on the reserve price and fixed price basis. This is due to the fact that the company does not enjoy monopoly in the said market and the price is totally market driven.
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The average of the prices offered by the bidder during auction is taken as the basis to fix the prices of materials to be sold through marketing department. Further the techniques of break-up-pricing are adopted i.e. the larger the quantity purchased lower will be the prices. This technique encourages the buyers to purchase larger quantity. Finally the managing director approves the prices set by the pricing committee. On this basis, a price list is prepared for all the potential buyers. Price list also indicates the sales tax and Excise duty to be levied. Thus the interested parties place their orders with the marketing department on the basis of price list reviewed every month. Every customer is required to have a security deposit amount of Rs.1 lakh. The payment for the material required is to be in advance. The material is supposed to be lifted on the specified date on account of delay the party has to pay the difference in the prices, if there is any increase in subsequent month. Standing Pricing Committee: The committee reviews the price of various products and takes decision in favor of maximizing the revenue. It holds meeting at least once in a

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month. But the volatility of the market and pool of different products lead to a number of meeting of the committee in quick succession.

The committee consists of: GM (Utility), Chairman GM (Marketing), Convener DGM (Finance), member DGM (Sales Coordination), member DGM (Stores), member DGM (BPP), member

For Scrap goods the DGM (SSD) replaces the DGM (BPP). Rests of all the members are always present in all the meetings.

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While deciding the price following points are kept in mind: Dispatch of the last month. Material in stock. Forecast of next month. General market condition. Availability of transport facility.

GM (Marketing), as per the need, decides the frequency and time of meetings to be held. Minute report of all the meetings is prepared and it contains the existing price and the proposed price. The final price is moved to the MD through the official channel including GM (Marketing), Executive Director (MM), GM (Finance and Accounts), and ED (Works). After the MDs approval the price becomes applicable and the circular indicating the revised price is printed, issued and distribution to the customers and all the concerned departments.

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SALES PROMOTION
Sales Promotion consists of a diverse collection of incentive tools designed to stimulate quicker or greater purchase of particular product. As a part of promotional activities, BSL is employing following activities: a) Discount slabs is provided to boost the sales, description of which is given below: Up to 10,000 tones 10,000 to 15,000 Above 15,000 ----- No Discount ----- 15% Discount ----- 20% Discount

b) To find new customers and to inform customers at far distant areas Tender Notice given in the newspaper for sale of scraps. Best among the application is accepted with a view to get the best revenue. c) Sometimes when new item is to be sold sales notice is given in the newspaper. But most of the time local customers get informed from other customers.

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MARKETING STRATEGIES OF BSL


Steel being an industrial commodity it is very necessary to maintain customer relationship for revenue earning and smooth running of company. 1. Customer Satisfaction BSL adopts following practices for customer satisfaction. a. Procedure / process adapted to access current / future expectation of customers. b. It induces market research visiting customer premises attending to customer complaints. c. CMO has Market Management Group where specialists monitor changing demand pattern and development in each Market segment is carried on. d. It has posted market development officers at various locations that are its eyes and ears for monitoring current and future expectation of its customer.

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e. The Business-planning department is exclusively meant to study customer's changing demand scenario and assess current and future expectation. f. To understand customer needs seminars and workshops are also organized by BSL.

Building Customer Relationship BSL has adopted the philosophy of recognizing segment of the market and identifying key customer in segment and giving them preferential treatment. CMO sales executives have been trained to use direct selling as tool for building long lasting relationship with the customers. Easy access to customers to seek assistance makes proposals send comments and compliments. MARKET DEVELOPMENT BSL has valued customers group in identifying their specific needs Specific to that group thus segmenting and developing market segment for our products. Major product modifications are done as per their

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specific needs of the Market segment thereby creating product differentiation packages. 2. STOCK REDUCTION Giving facilities like door delivery, road dispatches, credits facility and rounds the clock stockyard operation. 4 DESPATICH As the product is manufactured, this department directs the stockyards the mode of transport to the destination with reference to dispatch program and dispatch advice is mode. 5 DOCUMENTATION With the dispatch of product the Finance department calculates the total cost of product as per demand order. Certain receipts and bills quoting the material code, nature, quantity, and all expenses are sent to connected stockyard. The product will be then released to the concerned person after proper and complete payment to the pay-in- authorities is made.

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MARKETING OF SECONDARY PRODUCTS


During the sixties and seventies when the plant was one million-tones and2.5 million-tonnes capacity respectively, arising of secondary products was limited and such arising was recycled for re-melting. Therefore there was no scope for marketing in other words it was not economical. The plant capacity has been increased from 2.5 million tons to 4 million tones in the late sixties. New technology has been adopted while increasing the capacity of the plant where by the use of arising for re-melting drastically reduced. This has given more impact to the making of secondary product. In the nineties we have seen lot of changes in the economic scenario of the country. The concept of more employment in Public Sector Enterprises has changed to more generating revenue. There by the plant also has geared up its strategy towards this end. One of the strategies adopted by the plant for increasing the is marketing of secondary products. In the recent years a number of foundries and re-rolling Mills come into existence throughout the country. These small scales Sector need the "Secondary products" as input raw material for their production. The
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company has engaged in educating them the use of secondary products for different kinds of end products for consumption of general public. The plant extends all types of facilities and assistance to these smallscale units. This, in turn gives scope for more employment opportunities. The plant for marketing has adopted following strategy: 1. 2. 3. 4. Committed delivery. Competitive price Quick complaint settlement. Culture of customer service.

It is necessary to mentioned here that the companies' profit consists of 10% turnover of secondary products for the Last two years.

PLANNING FOR SALE OF SECONDARY PRODUCT 1. Marketing Recovery Department (MRD) works out the quantum of different types of scrap available for sale on monthly basis. This is determined by ascertaining the total scrap stock at the beginning of the month. Scrap arising during consumption. The remaining quantity is
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considered for sale. A, monthly report on availability of scrap is prepared by MRD and sent to marketing department. 2. Marketing Department finalizes the plan for actual quantity of scrap to be sold in consultation with MRD. Marketing department finalizes mode of sale, terms and conditions for sale, locations and commercial aspects. 3. The pricing committee consist of Managing Directors fixes the price of each type of scrap. 4. Marketing department obtains MD's approval on price fixed by pricing committee.

PROCEDURE APPLIED FOR SALE OF SECONDARY PRODUCTS

1. After obtaining approval of quantity and price for sale, Marketing department scrutinizes the demand from various parties, examine the Priorities and issue "offer letters" to respective parties. The terms and conditions for sale are also enclosed with the "offers Letter"

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2. About one third of the quantity of material to be sold during the year is offered to the actual users, subject to registration of demand. 3. For the balance quantity to be sold at prices fixed by pricing committee, preference is given to actual users over traders. If there are no actual users, the material may be offered to traders giving preference to registered traders over others. 4. First preference is given to the actual users for allotment of scrap against particular category of users. Scrap processing units are given second preference for such allotments. 5. The amount received from the party towards advance payment and security deposit is forwarded to finance department by marketing department after recording the details in the register. 6. Parties are allowed to visit the respective location disposals site, and inspect the scrap offered for sale. 7. Marketing department prepares sale order for the parties who have accepted the offer. Sale orders are issued party wise and category wise i.e. individual sale order covers such categories like C I scrap, steel scrap, re-rollable, slag and waste products.

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8. Based on the deposit made by the party, finance department intimates to marketing department about release of requisite scrap for supply.

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THE STRUCTURE OF THE PROCESS OF SALES AND MARKETING

PRODUCTS

PRIMARY (SPECIFIC PARAMETER)

SECONDARY/BY-PRODUCTS

CMO (KOLKATA)

UNITS- BSL, BSS, RSP, DSP etc

BSL MARKETING

METHOD OF SELLING

E-AUCTION SALE

TENDER

FIXED PRICE SALE

BSL MARKETING (MAIN SECTION)

STEEL

CHEMICAL & BYE-PRODUCTS

SLAGS & WASTE PRODUCTS

IDLE ASSETS

PRICING
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MODE OF SALE OF SECONDARY AND BY-PRODUCT Selling of

Secondary & By-Product


This involves a direct marketing process. The management of BSL in consultation with the official of the market development and customer service department work as group for the sale of these items. Different modes of selling are used for these products

MODE OF SALE

E-auction

Fixed Price Sale

Inter Plant Transfer

Tender
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E-AUCTION
Procedure of E-Auction Advertisement/posting of dates and types of materials to be auctioned in SAIL website and various news papers (Local & National) every 15th to 20th of the month for the next month, 1. Posting of details of lots to be auctioned one week prior to the date of auction, on the website of SAIL and metal Junction.com. 2. Inspection of lots to be auctioned by customers. 3. Auction is held on www. Metal Junction.com. 4. Report of auction conducted is give by Metal Junction.com. 5. Meeting of reserve price opening committee and their recommendation. 6. Approval for sale of lots recommended by RP opening committee. 7. Issue of offer to the customers, based on approval of chief Executives.

In this method the defective materials from all the mills is arranged in heaps of 100-150 tones to be sold by auction. Generally auction sale takes place ones in a month. Representative from all the re-rolling mills turn
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up during auction and they bid for the available material. The raw material need of this mill is being made by the plant and the availability of the re-rollables has increased the re-rolling mill to develop very fast. The plant extends all types of facilities and assistance to these small scale units, which to turn give scope for more employment, and then the material is lifted on the terms and conditions as mentioned in the tenders.

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FLOW CHART OF E-AUCTION Advertisement of dates/type of materials on SAIL website/Newspaper

Posting of lot details to be auctioned on SAIL / Metal Junction website

Inspection of lots by customers Auction conducted on Metal junction.com

Report of Auction by metaljunction.com Reserve Price Opening Committee meeting Recommendations Approval for Sale

Issue of Offer Letter

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DEFINITION OF KEY TERMS Auction. Auction refers to a forum where the requirement for one/more lots of an item is stated and the participants (bidders) are required to bid down the price to be selected to supply the requirement. Online Auctions. Online auctions refer to those auctions conducted through the Internet with the bidders (from one or more locations) simultaneously bidding to be selected for supplying the item/s on auction. In other words, the venue for the auction is on an Internet website/ platform. The "Service Provider's" website assigned by "Service Provider" would constitute venue for the purpose of the online auction. Award at the Auction. In a single winner format, only one bidder (normally the bidder who quotes the highest price) is awarded all the units of the item being auctioned. The bidder quoting the highest price is normally allotted the item. Client.
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Client is the individual/business entity who has contracted "Service Provider" to conduct such auction. In case of auction, the purpose would be the genuine intent to sell the selected items/Lot to the bidders desiring to buy these items from the Client. Bidder. Bidder is the individual/business entity participating in the auction, intending to buy the items/Lots from the Client. To be become a Bidder in the auction, a business entity has to secure client approval for participation and also provide written assent to the General Rules and Regulations Auction Engine. Auction Engine refers to the software that encapsulates the entire auction environment, processing logic and information flows. "Service Provider" is the sole owner of the auction engine and retains exclusive right over the utilization of the same. Timings of the Online Bid. All the timings of the Online Bid shall be based on the time indicated by the Server hosting the Auction Engine. It shall be the endeavor of

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"Service Provider" to ensure that the Server Time reflects as closely as possible the Indian Standard Time (IST) i.e. GMT + 0530 hrs. However, in the event of any deviations between the Server Time and the Indian Standard Time, the functioning of the Auction Engine (Launch, operation, and closure) would be guided by the Server Time. Bidders are advised to refresh both the windows of the Auction Module check the exact Server Time (displayed in both the windows). Preview Time. Preview Time refers to the period of time that is provided prior to the commencement of bidding. This is to facilitate approved participants to view the auction details such as item specifications, bidding details and bidding rules. The purpose is also to familiarize participants with the functionality and screens of the auction mechanism. It is not mandatory for "Service Provider" to provide Preview Time. Start Time. Start time refers to the time of commencement of the conduct of the online auction. It signals the commencement of the Price Discovery process through competitive bidding.

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Duration of the Auction. It refers to the length of time the price discovery process is allowed to continue by accepting bids from competing bidders. The duration of the auction would normally be for a pre-specified period of time. However, the bidding rules may state the conditions when the pre-specified duration may be curtailed/ extended. The conditions include: Shortening of auction duration in the event of no bids for a specified period of time (Inactivity Time) Automatic extension in the event of bids being entered towards the end of the scheduled duration to facilitate the other bidders to view and react to the bid. Auto Extension of the Auction Timings. In the event of bids in the last few minutes of the scheduled bid time, the Bid Timings are automatically extended for a specified period from each such bid. Such Auto Extension shall continue until no bids are placed for the specified period (Engine remains inactive for the specified period). The Inactivity Time for Auto Extension purpose is normally X minutes. "Service Provider" however retains the right to change the same. The

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Inactivity Time applicable for the particular Online Bid shall be visible to the bidders under the Bidding Rules module on the engine. End of the Auction. End of the Auction refers to the termination of the auction proceedings signaling an end to the price discovery process.

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FIXED PRICE SALE


PROCEDURE OF SALE THROUGH FIXED PRICE

General Sale notice for different items to be sold is posted on SAIL


website and advertise in various newspapers (Local and National) between every 15th to 20th of the month for the next month,

For

requisition of materials, applications are invited from

customers bet 25th -30th/31st of every month.

Allocation

of material to various customers is done as per

approved procedure of priority allocation.

Offer letters are issued to the customers. Price applicable will be the price rising at the time of dispatch.

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FLOW CHART OF FIXED PRICE

Advertisement of type of materials on SAIL website/Newspaper

Application from customers

Allocation of material

Issue of offer letter

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PRIORITY IN BOOKING OF MATERIALS BY MARKETING DEPTT Category Priority Buyer Quantity to be allotted A 1st Govt. Units/PSUs & its subsidiaries & joint ventures of govt. units having more than 50% govt. share Any quantity required by them

2nd

Dependent BIADA units with MD/BIADAS recommendations & MD/BSLs approval.

Maximum 70% of the balance available quantity after meeting the 1st priority

3rd

Consumers/Processes of Jharkhand state

30% of balance

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4th

To all other customers

Out of the balance quantity of material left if any

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TENDER
TENDER DOCUMENT
TERMS & CONDITIONS 1) The parties desirous of purchasing the material have to quote for entire quantity of the material. 2) The Tenderers are advised to inspect the material , if so desired, before submitting the quotations. Parties will be permitted to see the materials from 9.30 Hrs to 4.30 Hrs daily on working days. Necessary entry passes may be obtained from the Receptionist/ CISF 3) Terms of sale: On As is where is basis ", " No complaint basis and Ex-works basis" No PICK and CHOOSE shall be allowed other than sorting out Iron/Steel pieces found, if any. 4) The conditional quotations are liable to be rejected. 5) EARNEST MONEY EMD (Earnest Money Deposit) Rs.100000/- for the item to be deposited in the form of DD/BC/PAY ORDER in favors of SAIL/Bokaro Steel
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Plant, payable at Bokaro, from any Nationalized / Scheduled banks along with the quotations. Any variation / demand in such taxes, duties, levies, and charges and / or any fresh imposition of such taxes, duties, levies and charges shall also be to the account of the bidder to whom the tender is awarded. The tenders should quote their rate in per cubic meter against the total quantity as asked for in the tender document both in words and figures. In case of any mismatch / ambiguity between the two the higher of the two rates only shall be considered. The tender should be submitted in the TENDER BOX placed inside the CONFERENCE HALL OF MARKETING DEPARTMENT . The general terms and conditions of lifting by road and safety stipulations in force shall be applicable. 6) PAYMENT TERMS: The successful bidder has to make payment for the quoted quantity in 12 (twelve) equal installments of 1000 CU. each. 1st installment is to be deposited within 10 (Ten) days from date of issue of sale order inclusive of the date of issue of sale order. Subsequent installments are to be deposited within 30 (Thirty), 50 (Fifty), 70 (Seventy), 90 (Ninety), 110
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(One hundred ten), 130 (One hundred thirty), 150 (One hundred fifty), 170 (One Hundred seventy), 190 (One hundred Ninety), 210 (Two Hundred ten) & 230 (Two Hundred Thirty) days from the date of issue of sale order (inclusive of the date of issue of sale order). However, lifting of entire quantity of material has to be completed within the validity period of 300 (Three Hundred) days from the date of issue of sale order (inclusive of the date of issue of sale order). Payments shall be in the form of DD/BC/Pay order or acknowledgement note from SBI, IFB commercial, Branch of Raipur /Bokaro payable at Bokaro from any of the Nationalized / Scheduled banks in favor of SAIL /Bokaro Steel Plant. In case of failure of payment as mentioned above and or failure in lifting of material within the validity period of lifting, the Management reserves the right to cancel the sale Order and forfeit the security deposit. 7) LOADING AND TRANSPORTATION: Loading and transportation of the material in the tenderer vehicle has also to be done by the tenderer at their own cost and arrangements. Successful customer will be allowed to lift the material only 4 days in a week.

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8) Bokaro Steel Plant reserves the right to accept or reject any of the tenders or all the tenders or award contract to any other customer fully or partially without assigning any reason. 9) The management reserves the rights to divide the quantity offered for sale and allot the material to more than one tenderer. 10) VALIDITY OF LIFTING: The successful tenders have to complete the lifting of the allocated quantity of material within 300 (Three hundred) days from the date of issue of sale order. 11) The offer of the customer would remain valid for a period of 90 (Ninety) days from the date of opening. 12) Loading will be done under the supervision of MRD, the operating agency of the contract. 13) Evaluation criteria are the highest price for whole quantity (12000 Cu.) subject to the price being acceptable to the management.

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DATA COLLECTED SALES OF SECONDARY STEEL (Value in Lacks)

25000

20000

15000 Series1 10000 Series2

5000

0 1 2 3 4 5

PERIOD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

2009-10 15464 17179 17425 19194

2010-11 17022 20564 15602 13159

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SALES OF IRON & SCRAP (Value in Lacks)


2000 1800 1600 1400 1200 1000 800 600 400 200 0 1 2 3 4 Series1 Series2

PERIOD 2009-10 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr 1358 1515 1414 1872

2010-11 1726 1439 1503 1315

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SALES BFG SLAG (Value in Lacks)

1450 1400 1350 1300 1250 1200 1150 1100 1050 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Series1 Series2

PERIOD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

2009-10 1197 1333 1353 1340

2010-2011 1240 1314 1282 1398

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SALES BY-PRODUCTS (Value in Lacks) Chart Title


2010-11 32% 2005-06 10% 2006-07 13%

2007-08 12% 2009-10 19% 2008-09 14%

PERIOD 1ST Qtr 2ND Qtr 3RD Qtr 4TH Qtr TOTAL

2005-06 904 1320 1145 2024 5393

2006-07 1218 1731 1038 1797 5784

2007-08 1041 1417 1312 2045 5815

2008-09 1263 1458 1295 2115 6131

2009-10 1759 2047 2104 1918 7828

2010-11 2906 2797 2041 1701 9445

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SALES MISC OTHERS (Value in Lacks)

1600 1400 1200 1000 800 600 400 200 0 1 2 3 2009-10 2010-11

PERIOD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

2009-10 961 848 987 1182

2010-11 1457 1515 1065 462

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E-AUCTION (Value in Lakhs)


16000 14000 12000 10000 8000 6000 4000 2000 0 1 2 3 4 2009-10 2010-11

PERIOD 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

2009-10 8144 12100 9146 12619

2010-09 13410 10800 11223 6553

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PRODUCTION PERFORMANCE OF BSL

09-10 TARGET HOT METAL 4585 CRUDE STEEL SALEABLE CR-COIL SALAEBLE STEEL 3780 3900 3655 3600 4360 ACTUAL 4660 4130

10-11(MARCH) TARGET 5050 4700 ACTUAL 4020 3577

4210

6479

4110

3383

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PROFIT IN BSL

YEAR 2007-08 2008-09 2009-10 20010-11

PROFIT (Rs. IN CRORE) 2737 2830 1324

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SWOT ANALYSIS

STRENGTH-:

1. Bokaro Steel Plant has a huge pool of skilled and experienced personnel. 2. Principle of hierarchy is given due respect in BSP enabling management to ensure proper planning and its implementation. 3. Flawless corporate image of SAIL enhances the confidence of managers and customers alike. 4. Record of harmonious customer relation boosts the revenue graph towards north. 5. Strategic Information System in the organization gives cutting edge advantage reducing cost and time for every operation. 6. Huge infrastructure, when provides a strong base for better production and marketing, since it has countrywide network of stockyards, dockyard and sales branch offices. 7. The by-product of Bokaro Steel Plant is coal-based and of best quality against the petroleum based bye-products, giving the company a huge advantage against their competitors.
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8. Bokaro Steel Plant has TQP i.e. Total Quality People which mean a dedicated work force towards serving the companys customers. 9. A strong R&D cell of the company keeps on working over enriching the quality of its bye-products and to reduce the cost of the whole process.

WEAKNESS:-

1. Lack of teamwork and internal customer orientation inhibits proper implementation of companys policy. 2. Complex pre post sale activities repel the probable customers. 3. Due to its large organizational structure involving numerous policies and officials, prompt decision making is a real problem.

4. The hard working marketing officials are not given due recognition and appropriate reward that hurts their motivation and interest.

OPPORTUNITY:-

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1. There is growing demand for secondary and by-products in both domestic and international market. 2. State government is planning to establish small industries in and around Bokaro which will increase the list of probable customers. 3. New markets are to be searched and developed with the opening of the global steel market. 4. There is a great opportunity in the field of research to improve the quality of the coal-based products which would strengthen its well established base among customers.

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FINDINGS
RELATED TO MARKETING DEPARTMENT During our 6 weeks of training in marketing department of BSL. We have observed certain problems in it these problems are findings of our studies. 1. All marketing procedure of prime products are decided by SAIL and carried out by the Central Marketing Organization (CMO). 2. As the organization is concerned with a large number of productions activities and the departmental work are done mostly manually from placement of orders to documentation, which ultimately frustrates the employees. 3. The organization is more concerned with larger orders of steel products by ignoring the smaller orders. 4. The local customers with business of by-products are sometimes made to wait for days to get their papers cleared by the department. 5. Most of the existing yards suffers from improper stocking space and siding facility often they are not well developed due to this the material stored there are rusted and other defects are caused and later they are disposed of by offering some concession or at low rate which result in loss

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SUGGESTIONS & RECOMMENDATIONS: 1. Concept of Key Account Manager should be adopted for better customer satisfaction of regular customers. 2. 3. Extensive customer contact. The pricing as we well as the distribution policies should be framed by keeping in mind the requirements of the complete range of manufactures and not only the bulk consumers. This will encourage the new re-rolling mills to approach BSL for the material. 4. Price of the material for which 100% payment has been received as advance should not be changed if the delay in the lifting of the material by the party is due to some fault of BSL but if is due to deliberate delay in lifting the material by the customer than the same policy should be applicable. 5. When the customer having rolling mill of a smaller size purchase material, which are rolled in a bigger rolling mills than this, clearly indicates that the material is being purchase for trading. This practice can be prevented if BSL obtains a copy of certificates issued to the owner of every mill by the District industry center specifying the size of the mill. 6. BSL can appoint 2-3 authorized stockiest also to avoid trading practice. In this way the benefit of break up pricing can be passed on to the one for whom these have been framed i.e. the actual re-rollers. 7. Price list made available to the various re-rollers every month by BSL should count all the items but it should clearly indicate the material which is not available so that the customers requiring that particular material can approach some other source. 8. The infrastructure facilities at the disposal yard should be maintained properly and needs improvements so that the pace of the lifting process is increased.

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9. 10.

Fully equipped computers system in marketing department. Proper packing is to be done to safeguard the materials from damage, which is occurring due to multistage handling and transportation.

11.

Refund of excess payment process should be improved and simplified. It. should make payment in less time. Ensure delivery of the material for which the payment is accepted so that mills are not closed or shut down for want of material.

12.

Alternatively if the material is not available the BSL authorities should not accept the payment so that the buyer can approach some other source for procuring the material and should not unnecessarily wait for the material, which is not available.

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CONCLUSION BSL marketing network is spread all over India, which helps in collecting, orders of various customers easily and it can easily interact with its customers. 1. BSL officers posted outside like Kolkata, Delhi, Chennai and Mumbai who work in close coordination with the Marketing Department. 2. Sales of Secondary Product have reduced compare to previous year. 3. Sales of Iron & Scrap are also reduced compare to previous year. 4. Sales of Blast Furnace Slag are almost same as last year. 5. Sales of Pig Iron are less in this financial year. Last year sales of Pig Iron was nil in the 3 rd and 4th qtr but in this year its has shown good market which is good sign. 6. Market of By-Product shown good sign in this financial year and sales of By-Product has increased compare to previous year. The price of By-Product has reduced in this financial year. 7. BSL has fail to achieve the target which they set for them and unable to meet production of Hot Metal, Crude Steel, Saleable CR coils and Saleable Steel of the target, its result has seen on the profit of the company which reduced by 50% compare to last financial year.

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ANALYSIS OF DATA COLLECTED FROM THE CUSTOMER OF BSL Question 1:- In which category of customer do you belong? (a) Trader Table no : -5.1 SALES Trader Manufacturer Processor Others 45 30 20 05 (b) Manufacturer (c) Processor(d) Others

Sales
5%

20%
45%
Trader Manufacturer Processor

30%

Others

Interpretation:- From the above data it show that Trader (45%), Manufacturer (30%), Processor (20%) and others (5%) are involved in trading category with BSL. Thus, we can say that 45% are involved in trading category with BSL.
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Question 2:- Why do you prefer to purchase from BSL? (a) Quality (b) Cheap Transportation (c) Local Market (d) Low price

Table no: - 5.2 Quality Cheap Transportation Local Market Low price 40 20 33 07

Purchasing
7% 40% 33% Quality Cheap Transportation Loacl Market 20% Low Price

Interpretation:- From the above data 40% customer are prefer to purchase quality based product from BSL, 33 % are prefer to purchase product because of local market, 20% are prefer product for cheap transportation cost ,7 % are prefer low price of the product. Thus, we can say that 40% of the total customer prefer to buy the qulity based product from BSL,

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Question 3: - Are you satisfied with the quality of the product? (a) Yes Table no : - 5.3 Yes No 78 22 (b) No

Satisfied

22%

Yes No

78%

Interpretation: - From the above data 78 % are satisfied with the quality of the product of the BSL, 22 % are not satisfied with the quality of the product. Thus, we can say that the 78% of the customer were satisfied with of the product of the BSL.

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Question 4: - Are you dealing with any other steel company? (a) TATA (b) RINL (c) Essar Steel (e) Jindal Steel (d) Others

Table : - 5.4 TATA RINL Essar Steel Jindal Steel Others 50 10 12 15 13

Dealing
13% Tata 15% 50% 12% 10% RINL Essar Steel Jindal Steel Others

Interpretation: - From the above data Customers are dealing with some company also like 50% dealing with TATA, 10% with RINL, 12 % with Essar Steel, 15% with Jindal Steel, 13% with others company. Thus, we can say that 50% of the customer were dealing with the TATA.

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Question 5: - What type of product do you purchase from BSL? (a) Secondary Product (b) By- Product (c) Slag (d) Idle assets

Table no :- 5.5 Secondary Product By-Product Slag Idle assets 55 28 10 07

Purchased Product
5% 10%

Secondary Product By-Product 28% Slag 57% Idle assets

Interpretation: - From the above data 55 % customers prefer to purchase Secondary product from BSL, 28 % are on By- Product, 10 % on Slag, 7 % on the idle assets. Thus , we can say that the most of the customer prefer to purchase Seconary product from 104 BSL.

Question 6: - Your Company deal with

(a)Customer

(b) Wholesaler

(c) Other company (d) All of the them

Table no :- 5.6

Customer Wholesaler Other Company All of them

30 50 13 07

Deal
7% 13% 30% Customer Wholesaler Other Company All of them

50%

Interpretation: - From the above data Company 50 % deal with there wholesaler, 30 % dealing with there customer, 12 % on other company, rest 7 % dealing with all of them. Thus, we can say that 50% of them deal with there wholesaler .

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Question 7: - Considering your experience with BSL, how would you rate the overall quality of the product provided by the selected company?

(a) Excellent

(b) Very Good

(c) Good

(d) Fair

(e) Poor

Table no: - 5.7

Excellent Very Good Good Fair Poor

19 18 25 30 08

Experience
8% 19% Excellent 30% 18% Very Good Good Fair Poor

25%

Interpretation: - From the above data As compare to BSL other company 30 % provides fair quality of the product, 25 % provide good quality product, 19 % provide excellent quality, 18% provide very good quality of the product, 08 % provide poor quality of the product as compare to the BSL.Thus, we can say that the BSL provide the fair products to the customer.
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Question 8:- Considering the overall quality of product in relation to its price, how would you rate the value offered?

(a) Good

(b) Bad

Table no: - 5.8

Good Bad

60 40

Rate

40%

60%

Good Bad

Interpretation :- From the above data Its quality as compare to the price of the product was Good according to 60% customer ,& 40% of them says bad as compare to BSL. Thus, we can say that the more than the average customer were satisfied.

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Question 9: - Are you satisfied with your association with BSL?

(a) satisfied

(b)

Dissatisfied

Table no: - 5.9

Satisfied Dissatisfied

72 28

28%

Satisfied 72% Dissatisfied

Interpretation: - From the above data 72% customer says satisfied to the association with the BSL and 28 % are dissatisfied with the BSL with there association with the BSL. Thus, we can say that the customer were satisfied with association with BSL.

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Question 10: - For what purpose do you use the By-product purchased from BSL?

(a) Trading

(c) consumption

Table no:- 5.10

Trading Consumption

70 30

Purpose

30% Trading Consumption 70%

Interpretation: - From the above data 70% customer uses By-product for trading purpose and 30% using for consumption purpose. Thus, we can say that the customer uses By- product for trading.

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Question 11: - Which mode of sale you/your company prefer from BSL?

(a)

Fixed price

(b) E-auction (c) Open tender

Table no: -5.11

Fixed price E-auction Open tender

77 13 10

Sales
10% 13%

Fixed price E-auction 77% Open tender

Interpretation: - From the above data 77 % customers say they prefer fixed price mode of sale, 13 % says they prefer E-auction process and 10% they prefer open tender process. Thus, we can say that 77% customer prefer fixed price mode of sale.

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Question 12:- Which type of mode of transport are you using?

(a)

Railways

(b) Road

Table no :- 5.12

Railways Road

15 85

Mode of Transport
15%

Railways Road

85%

Interpretation: - From the above data 85% customers they using road for transportation and 15% they are railways for transportation purpose. Thus, we can say that the 85% of customer uses the road for transportation.

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ANNEXURE
QUESTIONNAIRE

1.

Name (Optional) : Company Name :

----------------------- 3. Age : ------------------------------- 4. Phone No

5. Address : ---------------------------

2.

: --------------------

Question 1:- In which category of customer do you belong? (a) Trader (b) Manufacturer (c) Processor (d)Others

Question 2:- Why do you prefer to purchase from BSL? (a)Quality (b) Cheap Transportation (c) Local Market (d) Low price

Question 3: - Are you satisfied with the quality of the product? (a) Yes (b) No

Question 4: - Are you dealing with any other steel company? (a) TATA (b) RINL (c) Essar Steel (e) Jindal Steel (d) Others

Question 5: - What type of product do you purchase from BSL? (a) Secondary Product (b) By- Product Question 6: - Your Company deal with (a)Customer (b) Wholesaler (c) Other company (d) All of the them (c) Slag (d) Idle assets

Question 7: - Considering your experience with BSL, how would you rate the overall quality of the product provided by the selected company? (a)Excellent (b) Very Good (c) Good (d) Fair (e) Poor

Question 8:- Considering the overall quality of product in relation to its price, how would you rate the value offered? (a) Good (b) Bad
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Question 9: - Are you satisfied with your association with BSL? (a) Satisfied (b) Dissatisfied

Question 10: - For what purpose do you use the By-product purchased from BSL? (a)Trading (b) consumption

Question 11: - Which mode of sale you/your company prefer from BSL? (a)Fixed price (b) E-auction (c) Open tender Question 12:- Which type of mode of transport are you using? (a)Railways (b) Road

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ABBREVIATION

1. SAIL 2. TISCO

- Steel Authority of India Limited. - TATA Iron and Steel Company.

3. MECON - Methodological & Engineering consultants ltd. 4. HSCL - Hindustan steel works consultants Ltd.

5. NMDC - National Mining Development Corporation ltd. 6. RDCIS - Research and Development Centre for Iron and Steel. 7. CET 8. CPTI 9. MRD 10. BFGS - Centre of Engineering and Technology. - Central Power Training Institute. - Marketing Recovery Department. - Blast Furnace Granulated Slag.

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BIBIOLOGRAPHY
BOOKS Marketing Management Marketing Management Websites
www.worldsteel.com www.mysteel.com www.tisco.com www.steel.nic.in www.ispatind.com www.indiansteelalliance.com

Philip Kotler Willian Stanton

Other Sources Report given by the companies Global steel industry news, statistics and information portal Research paper Magazines like Steel world.

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